The DW8 ship has entered choppy waters. Has happened while tech stocks are down the past few days & overshot on downside. RSI is in rebound zone. Expected SP to trade sideways in 9c range but it is what it is.
25,284 cases for May x $12.40 average = $313,521 x 12 = $3,762,252 run rate & 480% YOY growth.
At 7.8c SP = $130M MC - $7.5M cash = $122.5M / $3.76M = x32.6 revenue multiple is not high for 480% YOY growth.
With the $12.40 average per case for logistics there is currently no charge to the customer for storage & incoming freight due to incentives. Was previously about $17.50 per case average. Must cost about $5 per case for storage & freight from supplier to depots which are now free until June 30.
The real revenue is most likely 25,284 x $17.50 per case = $442,470 x 12 = $5,309,640 run rate when incentives are removed.
$122.5M / $5.3M = x23.1 revenue multiple is extremely low compared to the x40-44 average prior to the hype.
For June expecting circa 28,000 cases logistics + 250 cases B2B.
Revenues adjusted without incentives will be:
28,000 x $17.50 = $490,000
250 x $5.00 = $1,250
250 x $105 = $26,250 x 12% = $3,150
Total = $494,400 x 12 = $5,932,800 run rate
The incentives have distorted the revenue figures but they are due to finish June 30.
If you increase logistics by only 2,000 cases each month = circa 50,000 cases per month in 12 months.
If you increase B2B by 1,000 cases each month = circa 12,000 cases per month in 12 months.
If you increase B2C by 500 cases each month = circa 6,000 cases per month in 12 months.
50,000 x $17.50 = $875,000 per month.
12,000 x $5.00 = $60,000 per month.
12,000 x $105 = $1.26M x 12% = $151,200 per month.
6,000 x $10 = $60,000 per month.
6,000 x $210 = $1.26M x 6% = $75,600 per month.
Total = $1,221,800 x 12 = $14,661,600 revenue run rate in 12 months.
Revenue will triple in 12 months.
$122.5M / $15M in 12 months = x8 revenue multiple is not high. Discount revenue by 10% = $122.5M / $13.5M = x9 revenue multiple is still not high.
Have not sold a single share & don't plan on selling any.
Acquisition wise Kaddy will be an excellent bolt on in October. Their craft beer portfolio will compliment the extensive DW8 wine portfolio. May require a CR of circa $10M to fund the acquisition & extra cashflow.
The UK free trade agreement will create tailwinds for expansion into the UK. Most likely in 12 months as the focus now is local. Chile & a few other countries already pay no duty.
TheUK dutyon stillwineis £2.23 a bottle plus VAT (£2.68) from 1/2/19, up from £2.16 (£2.60 inc VAT). Sparklingwine dutyis up from £2.77 to £2.86 (£3.43 inc VAT). 3. 61% of a £5 bottle ofwineis tax (£2.23dutyplus 83p VAT = £3.06).
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